High Finance for Dummies (that's us....)

These days more and and more people are beginning to understand the way the world "works".

It actually only "works" for those who know how it "works" and use this knowledge for their own ends.  For everyone else the world "works" against them.

Before banking and after bartering, the currency for trade was gold or other precious metals, stones,etc.

Because carrying heavy gold, silver, etc. was impractical and security for your gold was necessary, banks were created to safely store your gold and issue you with a receipt .... the first paper currency which proved your gold-worth and could be traded instead of the actual physical gold.

This was the beginning of the end.

Bankers realised they could use "their" stock of deposited gold - which never left their vaults - to issue paper for their depositors' gold and charge INTEREST for themselves for that "service"... even without the knowledge or consent of the real owners of the gold.

Not only that but the value of issued paper receipt/notes quickly exceeded the total value of the physical stock of gold.

The first paper currency actually stated on it that gold could be redeemed for the note.  So the PAPER actually had REAL VALUE.

With the exponential growth of paper currency and the further invention of CREDIT it was no longer possible (or truthful) for the paper to represent physical gold....and the bankers stopped putting that statement on their paper.

So if the paper wasn't worth anything REAL in the physical world what was it worth?

Nothing - but the trust that people had that the paper could be traded for goods and services was enough for it to have a perceived value and continue to be used to "pay" for those goods and services.

Furthermore, since the paper does not require any gold or other asset to back its value, it can simply be printed whenever it is needed.  And in the modern world it does not even need to be printed - it can simply be typed into a computer.

Need a loan?  Say one hundred million euro?

The lender simply creates a loan on a ledger or on a computer screen - essentially it is a virtual creation - which promises to pay interest in return for the issuance of the loan.  So not only is it a virtual loan, but it in turn creates even MORE-virtual interest money.

And what does this virtual money represent?  Simply the trust between the lender and the borrower that the latter will repay the loan to the former with interest.

Trust.  That is what is traded.  Not gold.  Just trust.

So if money doesn't really exist, what is "wealth".

Wealth, in this system, becomes the ability to increase your stock of non-existent money.

The next stage of the banking scam is to create financial instruments which do not simply trade on trust, but trade on future trust and the performance of lenders and borrowers to create future virtual wealth.

When countries had their own individual currencies, the value of the currency was directly related to the wealth ( the ability to generate more virtual trust-money) of the country ..... its economic productivity .... or more exactly the productivity of its workforce.

So speculators would trade financial instruments based on their predictions of how a country's economy would perform and the currency's value would rise and fall based on the demand for it as a traded commodity.

The attractiveness of a currency / country as somewhere to invest would therefore be based on the productivity of the workforce.

So what happens when countries surrender their individual currency and become part of a larger economic entity with a unified single currency?  How do the speculators trade between countries if the wealth of a country can not be reflected in the strength of its currency?  How do you measure the wealth of a country then?

Essentially the measurement is the same .... it is the productivity of the workforce.  The productivity of the workforce is its ability to create added virtual trust-money to its stock - its ability to create virtual profit.  Investors will rush to profitable opportunities, and with added productivity comes the opportunity for added tax income for the government.

So instead of trading individual currencies (betting on future wealth) between countries the speculators begin trading future government income.  And the governments supply this demand for future trust-wealth by issuing instruments - BONDS - which promise payment of collected tax income to the bearer.

And as long as the workforce have no idea that the government are selling their future productivity because they TRUST the government to be the working FOR the people, the country remains a safe bet for the speculators and investors .... and MORE credit of virtual money is added to the virtual money is added to the virtual money is added to the virtual money is added to the virtual money is added to the virtual money is added to the virtual money.

THAT is why Enda Kenny got the cover of TIME magazine. THAT is why Enda Kenny got the NOBEL PEACE PRIZE.  THAT is why Enda Kenny was voted EUROPEAN OF THE YEAR......... because Irish people are HAPPY to accept austerity, HAPPY to pay whatever arbitrary nonsense taxes and charges the government can think of, HAPPY to continue to drink poisoned water which keeps them sedated, HAPPY to be informed by SKY NEWS and the State broadcaster, HAPPY to stay at home instead of take to the streets like every other EU population, HAPPY to let their corporate government sell off the country in return for nothing, HAPPY not to take an interest in politics or question the agenda of their government.  Every other head of state in Europe would LOVE to have compliant docile citizens like Ireland.  And every banker knows that as long as the country remains ignorant and sedated, then Ireland is a safe bet for investment .... because the people LOVE PAYING TAXES to foreign private corporations and the Irish government will PROTECT THEIR INVESTMENT.......


For the system to continue indefinitely and the virtual imaginary money to keep flowing, the workforce needs to constantly improve its productivity, to create trust-profit,. to willingly add more value for a smaller and smaller wage.

There are two potential outcomes for such a system.

The workforce becomes enslaved by their blind trust in the government and their dependence on their government masters to feed, house, clothe and take care of them......... or they eventually reach a point where the wage they receive for their productivity and the realisation of their exploitation, leads to revolution.

Welcome to Ireland 2013.

There are, however, alternative systems.

One is to revert to an individual gold-backed currency - a solution and mechanism I proposed earlier and validated in principle by Constantin Gurdgiev.

http://emeraldfist.blogspot.ie/2013/01/drum-stigs-two-point-plan-for-economic.html

Another is to continue trading in the commodity already traded by us without realising it : TRUST

http://www.ted.com/talks/rachel_botsman_the_currency_of_the_new_economy_is_trust.html

and I'm sure there are many more..........and now is the time to choose, because if we don't choose we will have the decision made for us......and it will be a perpetuation of the status quo.

At that point we will be slaves.

After that point the only choice will by revolution.

Choose now.